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Abstract

Market Overview

Whereas the "Other Stackables" commercial market is expected to grow at a rate
more than twice that of the PC-104 board market, this growth is partially
driven by revenue attributable to small form factor boards without any
expansion capability. These are only classified within the "Other Stackables"
market segment because of the legacy lineage of their respective board
standards.

We do, however, anticipate that the continued size reductions of these related
motherboards will present the market - and well positioned vendors - with
opportunities for growth going forward.

The same time-to-market pressures that originally drove many OEMs to look for
flexible COTS computing systems and fostered the creation of many of the
stackable form factors is now causing many board vendors to reevaluate the
breadth of their own solution portfolio. Increasingly, OEMs are looking for
board vendors to provide - or at least facilitate - a higher level of
out-of-thebox end system functionality through tighter integration of
operating systems and other software stack components with their own
solutions. We expect that these types features and bundles, as well as access
to software development kits and tools, will become an increasingly important
factor influencing the merchant computer board market going forward.

The market for stackable computer boards originally evolved out of a need for
flexible, secure computing platforms that could withstand the environmental
factors in rugged and/or industrial settings. Whereas this innate requirement
of many embedded application classes continues to dictate component and
solution selection, increasing pressures for smaller, more mobile designs is
causing some OEMs to look to other form factors such as COMs in greater
frequency.

Despite the potential shift of some designs to other computing form factors
and the downward pressures driven by the market's traditional dependence on
the military / aerospace sector (which will likely face public policy-driven
budget cuts over the next few years), we still project the aggregate market to
grow at a rate of over 8% per year. This resilient market growth is largely
attributable to two main factors: the long design/life cycles and relatively
inelastic component requirements typical of the mil/aero and industrial
automation projects; and the sustained, gradual expansion of market demand for
boards incorporating more sophisticated integrated feature sets, largely
driven by the continued adoption of the board in new higher growth markets
such as transportation.

Strategic Issues, Trends & Market Drivers

The stackables market faces a number of challenges to its
adoption

Other Stackables Trends

For the past 20 years, stackable architectures, in general, have enabled
hundreds if not thousands of new embedded applications to use an off-theshelf
x86 solution where a custom solution might otherwise have been required.

VDC believes the introduction of even smaller form factors, be they
stackable or not, could result in ubiquitous, interconnected, low-power,
eco-friendly computing solutions with long production life and simplified I/O,
software connectivity, and legacy support.

Among the leading stackable form factors in 2013 will be 3.5", EPIC and
EPIC Express .

The growth in "other stackables" is due to the increased demand for small
form factor motherboards (active backplane), and not to their stackable
capability.

PC104 Stackables Trends

Asia Pacific countries will likely show a slightly increased demand for
stackables.

While multicore is a trend in stackables technology like the rest of the
embedded space, it is occurring at a slower pace in stackables because the
additional performance may not justify the additional design effort and cost.

However, VDC believes the PC/104 family, which has slowly evolved over the
past twenty years, has not grown as rapidly as other embedded stackable form
factors, or even modern embedded board technology in general. Apparent
confusion around standards, and the perceived lack of a cohesive ecosystem
could - conceivably - derail the platform, unless PC/104 expansion modules can
keep pace with the changes needed to enable contemporary high-speed,
high-throughput, and highlysecure rugged applications.

Nonetheless, PC/104 technology is still ideal for rugged applications with
wide temperature ranges, due to the pin-andsocket stacking expansion bus
connector system and the corner mounting holes which may be used to bolt the
stack together.

Market Segmentation, Estimates & Forecasts

Global demand for PC/104 family modules is expected to increase
moderately through 2015

While VDC sees the PC/104 family modules market growing, some PC/104 suppliers
have expressed concerns about the stackable concept and the cabling complexity
and extensive mechanical design efforts that may be required. When
applications have higher production volumes, designers may utilize COMs and
COM carriers due to ease of use and more advantageous cost structure.

Multiple PC/104 form factors also require compatible expansion modules that
may have the same functionality but utilize different expansion buses,
potentially adding to design and production complexity.

Nonetheless, PC/104 technology is still ideal for rugged applications with
wide temperature ranges, due to the pinand- socket stacking expansion bus
connector system and the corner mounting holes which may be used to bolt the
stack together.

This makes PC/104 ideal for transportation vehicles and military equipment,
where shock and vibration might ultimately destroy a system built and mounted
without the rugged and hardened features available through PC/104.

Table of Contents

Executive Summary

Page 8 Global demand for PC/104 family modules is expected to increase
moderately through 2015

Page 9 PC/104 family modules will continue to be deployed in industrial
automation and military and defense segments

Page 10 Global demand for other stackable form factors is expected to
accelerate through 2015

Page 11 Other stackable form factors are prominent in the industrial
automation and control and medical vertical segments

Page 12 Worldwide demand for stackable form factors is predicted to rise
through 2015

Scope & Methodology

Page 14 VDC's research coverage and analysis examines a number of market
segments along three primary dimensions